Blue-chip shares had seen a grim first couple of weeks of 2016 as the FTSE 100 plummeted close to 5,600, at levels not seen since November 2012.

The index dipped into "bear market" territory - meaning it was a fifth off its peak less than a year ago - amid investor worries over the slowing Chinese economy and the slump in the price of oil. A barrel of Brent crude fell below $30 to reach its lowest price for more than 12 years.

Markets were also vulnerable to volatility in the wake of the US Federal Reserve's decision in December to raise interest rates for the first time since the financial crisis.

Bank of England governor Mark Carney told MPs the hike was partly to blame for the turmoil.

But the pledge of more possible stimulus - in the form of low interest rates and billions of euros of bond purchases from the European Central Bank - helped global stock markets turn higher after the worst point in the slump last week.

A speech by Mr Carney indicating UK interest rates would remain on hold for some time yet also helped the mood among investors.

Meanwhile, Brent crude has headed back above $30 amid hopes that oil-producing countries might be willing to seek agreement on cutting back production in an attempt to address the over-supply that has driven the price down.

It meant the FTSE 100 still closed at the end of January about 160 points lower than where it had started the month but well ahead of the troughs it reached only a week ago.

Spreadex analyst Connor Campbell said: "The Bank of Japan has managed to temporarily ease some of the macroeconomic tensions that have plagued the start to 2016."